MINDING YOUR BUSINESS

Alternative energy firms seek powerful beginning

Rising natural gas, oil prices fuel hopes of increased demand

Soaring energy prices might be bad news for most people, but Mike Taggett hopes the situation fuels interest in his Henry Cyclone invention.

The Henry Cyclone system is designed to reuse the heat from a vehicle's exhaust to increase its fuel efficiency by about 15 percent, the Chicago entrepreneur explained.

"For every horsepower that a car engine makes, there's two horsepower that's lost to the environment because of excess heat" from exhaust and the radiator, said Taggett, president of Henry Engine Inc.

Taggett's Henry Cyclone is just one of several Illinois alternative energy innovations trying to get to market. With oil and natural gas prices in the stratosphere, other entrepreneurs see big potential in wind power and solar energy.

"We have the sun and the wind available to us for free. We might as well use it," said Bruce Papiech, vice president of Sublette, Ill.-based Forever Power and Construction Services, also called FPC Services, which designs and installs wind- and solar-powered systems for residential and commercial use. Sublette is about 50 miles southwest of DeKalb.

But gaining widespread acceptance remains a challenge for most of these alternative-energy innovators. To succeed on a large scale, the entrepreneurs must win over a skeptical marketplace, and that involves convincing more people of the merits of their technology.

"The auto industry is a hard industry to break into. It's hard to get meetings," said Taggett, who hopes to license his technology to other companies for implementation.

Changing the way homes and buildings are heated isn't much easier. Often, the upfront costs are a show-stopper. But by explaining how the initial cost of a wind-powered energy system will pay for itself over time, homeowners and businesses often become more interested, said Joyce Papiech, president of FPC Services.

While FPC's wind-powered systems for residential homes often cost about $40,000 to purchase and install, most people recoup those costs in 8 to 12 years, Bruce Papiech said. The systems typically last more than 30 years.

"Some people like to think of it as a retirement plan," Joyce Papiech said, because the investment you make today will save you money later.

Interest in the firm's renewable energy solutions is growing, she said. "Sometimes we haven't been able to keep up."

As demand rises for new energy systems, the costs should come down, said William Worek, director of the Energy Resources Center at the University of Illinois at Chicago.

"Economies of scale will lower the cost," he said. "Sometimes you need a push, either through incentives, a rebate or a grant, to give you the critical mass to bring the costs down."

Utility companies have received a nudge in the form of government mandates to diversify their energy production with renewables, such as wind power. And that's been a ticket to growth for Invenergy, a Chicago-based energy company focusing on large-scale wind-power development, said Michael Polsky, president and chief executive. His company develops wind sites and sells the wind power to utilities.

"Where there's no mandate, there's practically no demand," Polsky said. "There has to be some government intervention."

But start-up Aerotecture Ltd. is encouraged by early interest from businesses and individuals in its new wind turbine, which works better in urban areas with sporadic wind conditions than conventional windmills do, said Lesleigh Lippitt, partner in the Chicago-based business with her husband, BilBecker, an associate professor in industrial design at the University of Illinois at Chicago.

The company has received inquiries from Ireland, Africa, Sweden, China and the Philippines, not to mention domestically, but it is proceeding slowly, Lippitt said.

"We're making sure we're prepared for the things that await us," she said.

While demand can spur a company to act quickly, rushing a product to market too soon "could be a death blow for a technology," agreed Worek. "Sometimes it's better not to get it to the marketplace too early, even though the market is probably clamoring for it."

Aerotecture has a working prototype of its AeroTurbine, which is being tested in several locations across the country. It hopes to move into mass production soon, Lippitt said.

The AeroTurbine units can be mounted vertically or horizontally on a building for a smaller profile than most windmills. The blades operate in all directions, so the units require lower wind speeds to operate effectively. They self-regulate, making them ideal for urban areas with sporadic wind, Lippitt said.

Meanwhile, Taggett still needs to run more wide-scale tests on his engine system before it will make it to market. Besides the Henry Cyclone system, he has been working on a small-scale rotary steam engine, called the Henry Engine, that can be used in some air-conditioning systems, he said.

Solargenix Energy LLC, based in Raleigh, N.C., is among those interested in the engine.

"Mike's work is important in that it will get us into thermal-electro power production for small systems, which is useful for residential building applications," said Tom Henkel of Solargenix. Most existing steam turbines start at about 500 kilowatts, he said, which is too large for residential applications.

Taggett formed Henry Engine Inc. in 1994 and has financed it using the proceeds from a business he sold. He has tinkered with alternative energy inventions for about two decades.

He needs a steam supply to test his rotary engine prototype for more than 1,000 hours or so, he said. He hopes a manufacturer that generates steam as a byproduct will allow him to tap in.

"Everyone keeps saying the timing sure is good for what I'm doing," Taggett said. "But nothing has really jumped in terms of a business relationship."